Micron Technology's stock plummeted 11.91% during intraday trading on Tuesday, as the memory chipmaker was caught in a widespread technology sector selloff.
The sharp decline was driven by multiple factors converging. Investors are growing concerned about more aggressive interest rate hikes from the Federal Reserve under new Chair Kevin Warsh, which would increase borrowing costs for companies heavily investing in artificial intelligence infrastructure. This has led to a broader rotation out of high-flying tech stocks that have seen massive gains this year.
Additionally, the selloff spilled over from Asian markets where South Korea's KOSPI index crashed 10%, dragging down chip giants Samsung and SK Hynix by over 12%. The global tech weakness extended to U.S. chip stocks as investors took profits ahead of Micron's quarterly earnings report scheduled for Wednesday. Despite overwhelmingly bullish analyst expectations, traders are questioning whether the stock's nearly 300% year-to-date rally has already priced in strong results, leading to defensive positioning and profit-taking across the semiconductor sector.